How to Develop a Succession Plan

Whether you’re developing a succession plan for a small family business, a large nonprofit organization, an educational institution, a major corporation, or a government organization, the process boils down to six steps:

Determine the type of plan.

What concerns are stimulating you to develop your succession plan? Are you worried about unexpected departures due to illness or more competitive offers elsewhere? Are you aware of the planned departures of several key people who are scheduled to retire during the next two years? Or are you planning new strategic directions for your organization that will require new kinds of competencies for people in key positions? Clarifying your reason for developing a succession plan will help you construct a plan that truly meets your organization’s needs.

Put a succession-planning team together.

Find the right balance of people in your organization to participate in the succession-planning process. Select people who are process-oriented, effective communicators, knowledgeable about job competencies and competency development, and connected throughout your organization in ways that will help garner support for your plan.

Identify the main factors that will influence your plan.

You need to anticipate factors that may influence the success of your succession plan. For example, you may see changing trends occurring in the marketplace that will require new competencies in key positions. You may see dramatic changes in your workplace, leading to a more diverse generational and cultural workforce that require new ways of developing internal talent.

Your overall strategic plan tells everyone — customers and employees alike — what your organization is all about, where it’s going, and how it will get there. If your succession plan is out of sync with your overall strategic plan, your succession plan is doomed to failure from the start. You need to partner the two plans every step of the way. Your strategic plan, along with the influential factors you identified in Step 3, will enable you to identify the key positions that your plan must cover.

Identify sources for successor candidates.

Having identified the key positions to be included in your plan, develop potential candidate pools. In order to do that, you need to spell out the competencies (talents, skills, and knowledge) required for each key position.

Then, after you’ve identified the competencies required, you’re ready to determine where you can find these individuals. They will come from two major sources: The first source is internal, namely in your own backyard. Many people in your organization likely already have the required competencies or, with some development, can acquire them. The second source is external, such as employment agencies, Internet job boards, professional association websites, colleges and universities, job fairs, and so on.

Shape action plans.

A succession plan by itself is useless. It needs to be translated into concrete action plans, with measurable goals, specified timelines, and people accountable for taking various actions or applying required processes. Plus, the implementation of your plan needs to be continuously monitored by your succession-planning team, evaluated on an ongoing basis, and adjusted for unexpected events in order to ensure its success.